Thank you.
Good afternoon, dear investors and friends in the media. Welcome to the mid-term performance conference of China Telecom Co., Ltd. in 2024. First of all, allow me to introduce the board and management members of the conference today. They are the Executive Board Chairman and Chief Executive Officer, Mr. Ke Ruiwen. President and Chief Operating Officer, Mr. Liang Baojun.
Mr. Tan Ke, Executive Director and Vice President. Mr. Li Yinghui, Executive Director and Vice President. Mr. Wu Jiaming, Independent Non-Executive Director. Mr. Yang Zhiwei, Independent Non-Executive Director.
Today's conference will be divided into two parts, performance introduction and Q&A. The conference will be held in Mandarin. During the conference, please put your mobile phones in silent mode. Now, let's welcome Mr. Kerwin to introduce the company's mid-term performance in 2024. Chairman, please.
Ladies and gentlemen, good afternoon. Welcome to the company's mid-term performance conference in 2024. Thank you for your long-term concern and support for the company. Today's performance introduction is divided into two parts. First, I will introduce the overall overview of the company's first half year. Then, Mr. Liang Baojun will introduce the company's business and financial performance.
In the past year, the focus of company development has been on the following six aspects. First, steady growth in business performance. Continuous improvement in high-quality development. Second, continuous strengthening of technological innovation. Building up the production capacity of Xirang. Third, promoting AI plus quantum.
to accelerate the development of new production capacity. Fourth, to promote the upgrade of infrastructure and accelerate the transformation of smart green technology. Fifth, to fully deepen the reform and opening up, and to further enhance the vitality of the enterprise. Sixth, to build on the social responsibility and further enhance the shareholder's return. In the past six months, the company has been implementing the cloud-speed transformation strategy in-depth,
and actively expand personal, family, and government-owned information services. Operating performance has improved steadily. Income, EBITDA, net profit, ROE, and other indicators have all achieved good growth. In the first half of the year, the company's income has maintained good growth. Service income has increased by 4.3%, which is higher than that of the industry. Profitability continues to grow.
Net profit increased by 8.2%, higher than income. Net profit increased by 0.4%, shareholding revenue increased by 0.2%, and ROE increased by 0.2%. Tianyu Cloud is entering a new development phase of the smart cloud, maintaining rapid growth.
with a revenue of 5.52 billion yuan, and a service revenue ratio of 22.4%. The market leading position is stable. The company has accelerated the improvement of intelligent service capability, user satisfaction and reputation continue to consolidate and improve. The company is surrounded by network, cloud and cloud-to-network integration, AI,
and quantum security, to fully complete the RDO, Research and Development System, and continue to increase the investment in R&D. R&D costs increased by 12.5%. We also accelerated the construction of research teams. The number of R&D experts has exceeded 10,000. The number of R&D staff is close to 38,000.
has increased by more than 15% since the end of last year. Our company's technological innovation level has continued to improve. We have entered the 2023 Central Enterprise Technological Innovation Excellent Enterprise list. We have achieved breakthroughs in four major technical areas. We have acquired many cutting-edge technology and original technology testing sites. We are leading in cloud computing, quantum communication, and the next generation of offline innovation units.
The two projects have won the first prize in the 2023 National Science and Technology Award. The company has built a leading integrated smart service system and capabilities, built a computing platform, data model, and application-based computing cloud capabilities system, fully open ecological cooperation, providing large customers
which can be used for both good and bad purposes. Xirang's integrated computing platform breaks through many key technologies. It has a powerful computing network, efficient first-purchase computing, and a one-stop service. It provides a wide variety of public intelligence services. Xirang has now joined 39 computing partners.
All kinds of smart computing have reached 2.2 billion FLOPS. That is, we have joined 39 companies. The joining of these 39 companies has reached 2.2 billion FLOPS. In terms of public computing, Internet of Things, e-commerce computing, etc., we have accumulated a lot of application cases. The company continues to promote the improvement of the ability to build basic models.
We have made breakthroughs in the four-pronged technology PR. We have completed the dual-backup of the algorithm and service of the multi-modal multi-modal speech-to-speech model. The speech-to-speech model is the first independent backup in China. The speech-to-speech model with 1 billion, 100 billion, and more than 1 trillion parameters is the first to achieve open source in the central enterprise. In terms of big data, our company has released a chain of
data element system to achieve high-quality data. Xinhai Data Intelligence Center integrates AI fully and achieves multiple technological breakthroughs. Linze 2.0 data platform supports 10-provincial data element competition. The company deeply develops AI plus, and wide-ranging multi-industry smart development.
In the areas of digital governance, digital reputation, and digital economy, we have launched 32 scenario models. We serve more than 7,600 clients. We have integrated AI capabilities into digital platforms and customer solutions. We have promoted commercial model innovation. At the same time, we have created a cloud-based and end-to-end AI application ecosystem based on our new basic model capabilities.
to launch a series of standardized AI products such as AI cloud disk, AI cloud computer, and AI mobile phone, to meet the diversified and intelligent needs of customers. The company uses digital and intelligent means to fully promote the internal digital transformation upgrade of AI. For network operations, customer management, R&D and other enterprise operations, development and promotion of applications,
10 internal large models. Continuous expansion of performance to enhance the breadth and depth of coverage, perfect assessment and incentive, and double drive. Fully promote the reduction of enterprise costs, quality, and efficiency. In the first half of the year, the company's AI-enabled base station and base station smart power generation have been significantly improved. Smart customer service ratio has been steadily improved, and resource utilization efficiency has been steadily improved.
The company has been working to promote quantum home, to build operational security, to actively expand the quantum industry ecosystem, and to strengthen the production and use cooperation between research institutions, leading companies, and the industry chain. Based on QQD, TQC, and other technical systems, we have built quantum-secret key distribution, quantum-password resource pool, and quantum-password management platform quantum security infrastructure.
to integrate quantum technology into basic business and innovate business, launch the quantum home product system, and form a diversified advantage of secure applications to achieve scale development. To grasp market demand, accelerate digital information infrastructure transformation and upgrade, further enhance computing and network capabilities, and strengthen market competitiveness. In the first half of the year, complete capital expenditure,
47.2 billion yuan. In terms of computing power, we have increased our computing power by 11 billion flops. We have pushed the data center to fully upgrade to AIDC. At Jingjingji and Changshanjiao, we have built the world's leading all-nighter WAN card pool. At 31 provinces, we have deployed a reasoning pool to continue to optimize the computing power of the Internet.
In terms of network, we have added 5G architectural sharing base stations to exceed 100,000 stations to fully promote 5G-A capability upgrade. We have over 9 million 10G-POM terminals on the Tianzhao official website and deployed 50G-POM networks to support the demand for 10,000-MHz access to key scenarios. The company will continue to optimize its investment structure and maintain a total annual capital expenditure of less than 20%.
The company uses the 1248 green development model as a guide to create green cloud infrastructure and launch a variety of green product services. Over the past six months, the company has accelerated the upgrade of traditional communication buildings and base stations to green. There are 12 newly added Huoping National Green Collection Centers, the largest in the industry.
to reduce carbon emissions and maintain a double-digit growth. At the same time, we focus on clean production, pollution management, and environmental protection to create a series of green solutions to enable the green low-carbon transformation of the economic society. The company insists on a comprehensive bio-reformation reform, promote high-quality development, and promote the construction of three-tier enterprises.
focus on technological innovation, innovative business, talent development, market-driven business, and other areas of deepening the system and mechanism of reform. By strengthening all-round technology public relations, promoting technological transformation, deepening the industry, and innovating business and company reform, we will fully promote the optimization of the mainstream process, implement the talent-driven strategy, and contribute to the reform of the new type of business responsibility, and continue to enhance the vitality of the enterprise. The company actively promotes innovation,
high-level openness in the areas of business, talent, and capital, strengthen the digital transformation service platform, expand international cooperation in-depth, and promote comprehensive high-level openness. For three consecutive years, Huopin has been the A-level of the Central Enterprise Reform Key Task Assessment. The company actively takes on social responsibility, provides communication security for various important activities,
The company's high-quality development cannot be separated from the long-standing support and concern of shareholders, analysts, and media friends. We will continue to move forward with you as before and share the results of our development. The Board of Directors has decided to continue to develop
In the mid-term period, U.S. stocks rose by 0.1671 yuan, an increase of 16.7% in the same period. Paxili rose by more than 70%, an increase of more than 5% in the same period. The company will continue to keep its promise of dividends. From 2024, the profits allocated in cash in three years will gradually increase to more than 75% of the profits of shareholders in that year.
Currently, the company is at the critical juncture of high-quality development. In the face of the huge market opportunities and good development models of the digital economy, the company will continue to implement the cloud-based fast-change strategy with excellent execution, further deepen the reform and promote high-quality development. We will strive to achieve full-year income in 2024 and continue to maintain good growth in EBITDA.
The goal of Jingyi Run is higher than the income increase. We strive to improve the value of the enterprise and actively respond to large shareholders. This is the end of my introduction. Next, Mr. Liang Baojun will introduce the business and financial performance of the company. Thank you.
Thank you, Chairman Ke. Now, let me introduce the company's business and financial performance. The company has three major business sectors. In the first half of the year, the revenue has grown and the market is good. The operating cost has increased and the control is effective. Profitability continues to improve. Next, I will further introduce the development of GeQiang business. In the first half of the year,
The company's basic business is steadily developing, with cloud, network, AI, and applications as the main focus, accelerating the integration of cloud, AI, quantum, satellite, and other new elements into standard products. Therefore, the contribution of application services continues to increase, boosting the scale and value of the basic business. Mobile telecommunications service revenue has increased by 3.6%,
which increased by 17.1% in mobile payment and application revenue. In this way, mobile communication service revenue increased by 17.2%. Moving up to 46.3 yuan. In the past, smart home service revenue increased by 3.2%. Smart home business revenue increased by
14.4%, with an increase of 16.7% from the previous smart home service income ratio. Kuangdai comprehensive up to 48.3 yuan. AI cloud, AI video coloring, FTTR, Internet of Things, and other businesses, all continue to grow rapidly. In the first half of the year, the factory business continued to grow well.
The factory revenue has increased by 30% compared to the service revenue. The number of customers has increased by 11.9%. The ability of self-managed digital platforms has continued to improve. More than 110 platforms, services, industries, education, medical care, finance, etc. are key industries. Rich solutions effectively promote industry customers.
Digital transformation is a miracle. Tianyi Cloud, with its leading computing service capability, continues to grow in terms of customer and income scale. 29.2% to 4.5 million Tubi customers. 26% increase in public cloud income. The market share has further increased.
The company catches up with the various digital needs of customers, and fully utilizes the multi-pronged advantages of Tianyi Cloud, computer services, cloud-to-network integration, security reliability, digital services, etc. To meet the rich application scenario needs with a differentiated solution, we have created a batch of benchmark projects to gain widespread recognition in the market. The company's AI plus big data application continues to expand,
In the first half of the year, AI-wide FUNAN, 2G, 2B, 2C and 2H customers created multiple typical industry applications. In terms of big data, Lingze 2.0 data element platform serves 22 provincial and municipal public data operations and data infrastructure construction. Xinghai Data Intelligence Central Station landed more than 150 projects.
There are more than 50 data products cooperating units. Data products are becoming more and more prosperous. The company's high-quality safety products are widely recognized by the market. Among them, the 10-billion-yuan income of YunDi Anti-Earth Products has increased by 36%. The 100-million-yuan income of Tianyi Safety Brain and website security expert products
customers increased by 4.1% and 32% respectively. The safety-oriented models are becoming more and more advanced, further integrating AI technology and safety products to enhance the efficiency of safety operations and customer experience. Safety products and service standards have been widely replicated and the scale has expanded rapidly.
The company's rapid development of the new generation of new-generation telecommunications business, 5G, 2B, and industry applications have accumulated more than 3.6 trillion yuan, and the contract amount is about 3.4 billion yuan. Satellite telecommunications income has been achieved. The number of WeChat users connected to mobile phones has increased by 67% by the end of 2023. Low-cost economic projects have landed in Shenzhen, Jiangsu, etc.
Internet of Things revenue has increased by 46.4%, with users exceeding 88 million. The Internet of Things platform has 11-level connectivity and online perception control capabilities, with users exceeding 600 million. The company's international business continues to grow. In the first half of the year, revenue increased by 10%, while overseas revenue increased by 172%.
The number of international users has increased significantly to 136%. Overseas, we have made breakthroughs in our online business. We have successfully launched our mobile-connected WeChat business in Hong Kong. We have successfully launched our new goods wholesale, open-source, and international communications business. We have further strengthened our international cloud-based infrastructure. Our company is focusing on controlling resources, investing in strength and direction.
to effectively support high-quality development. The operating cost has increased by 2.4%, and the efficiency of input and output has been further improved. The company is tightening the digital economy development opportunity, increasing the key field of investment, strengthening the core technology public relations, continuing to promote the smartening and greening of infrastructure, increasing the introduction of technology-oriented and innovative talents,
to promote digital operations and improve resource efficiency. The company's financial strength continues to grow. In the first half of the year, EBITDA grew by 4.7% to 7.7 billion yuan. The shareholder's balance of equity grew by 3% to 4,563 billion yuan at the end of last year.
The asset-to-debt ratio is at a 47.1% health level. The main credit remains at the highest level of 3A. That's all for my introduction. Thank you. Next, let's move on to the Q&A session. Today's performance conference
Thank you.
Ladies and gentlemen, if you have any questions, please press star 1 1 on your phone. If you want to ask a question, please press star 1 1 as well. The first question is from GongBiYing from Xinhua.com. Your line is open.
Hello, can you hear me? Yes, we can hear you. Hello, Mr. Li, I have a question for the reporter. We have noticed that Mr. Ke has mentioned the reform many times in public. In the report, you also mentioned the reform. Could you please give us a detailed introduction on how you think about the reform and what remarkable achievements the reform has achieved so far?
Next, what important measures does China Telecom have to take? Thank you. Thank you for your question. You have a very tight grasp on the content, key points, and the company's work. You have a very precise grasp. I have indeed talked about the issue of reform on many occasions. Perhaps we have talked more about it internally.
Over the years, the company has always seen the comprehensive deepening of reform as a strong driving force for the company's development and a key move. Because the company has to fulfill its mission and responsibility, it has to give back to shareholders and society. The company itself has to promote traditional telecommunications operators,
such as service-based, technology-based, and security-based transformation, we must have a comprehensive biochemical reform. The achievements we have made over the years are actually the result of a comprehensive biochemical reform. As you all know, China Telecom has returned to the A-share market for more than three years. This is a major reform.
We seized the opportunity of such a major reform, and we promoted the high-quality development of the company with such a major reform. We used Huyai as the main platform, the main catcher, to fully promote the company's various reforms and promote various jobs. So we fulfilled the three-year commitment to the capital market of Huyai's listing.
Therefore, the reform has played a huge role in the company's development. It is a key move. Next, we need to stick to this key move and further deepen the reform. When I was introducing the PPT and performance, I said that the company's development is at a critical point in high-quality development.
The development of technology and industry is very fast. The potential high-quality demand is still very high. The policy environment is also very good. In particular, the company must have a very rich variety of resource elements. Network, users, data, capital, talent, technology.
There are many factors. We have good policy conditions and environment. At this time, how can we grasp the key time nodes through a comprehensive biochemical reform? How can we make good use of these factors? How can we improve our knowledge level? We have to rely on comprehensive biochemical reform. The general idea is the same. It is to surround the construction of three-star companies.
around the construction of technological enterprises, to improve the level of innovation and configuration of all kinds of resources and elements, and to enhance the motivation to configure these resources and achieve high-quality development. We need to configure the resources well.
around the construction of technological enterprises, to build good resources. I remember in the video just now, I think you can play it, there is a video, the layout of RDO, there is a video, you can take a look at the scene. I think that video is still okay. Oh, this one, this one. Let me see, let me take this one. In this one,
We have transitioned from traditional telecommunications operators to service, technology, and security companies. Technology is the core. So when we transition to technology companies, what was our original goal? Our original goal was to limit the development of technology to the network. But based on the standards of the network,
It's not really R&D. Now, we have to put our R&D system according to the RDO layout. We have four major technological directions, this is clear. We have four R research institutes, that is, technology research and application technology research. One is our current China Telecom Research Institute, which is particularly strong online. In addition, we recently set up several cloud computing research institutes.
Artificial Intelligence Research Institute, quantum research institute. This is a part of R. This has to be reformed. More importantly, a part that we are relatively lacking is a professional company. That is, platform companies, capability companies, such as cloud, AI, security, quantum, these platform companies, capability companies. We have relatively few companies that provide products, services and capabilities.
In the past, we were the strongest in the local network, in the provincial and municipal companies. But in the provincial and municipal companies, this organization, this process, is mainly used to sell and serve standardized products, basic telecommunications products. It does not fully adapt to the development of comprehensive IT services, cloud, artificial intelligence, quantum, and other such strategic new business.
So our reform mission is still very important. So we have been promoting these reforms over the years. For example, the development of our cloud companies, the development of our AI companies, the development of our security companies, the development of our quantum companies, and the development of these PaaS platforms. At the same time, we are in SAS, professional SAS, like our medical company, medical company, medical, health, education, finance, these kinds of professional BG are also very fast.
Especially in recent years, we have been promoting our main source of resources, which is the provincial and county-level companies. The main process of reform in this area, the construction of the second team in this area, this is the key, the most important. These are some of the advantages we have gained. So how can we configure this well? This is our ability to manage the situation.
So I think, to put it simply, it is a very important task to deepen the reform. After years of hard work, we are confident in promoting this reform. This year, we have a clear goal. For example, the main process of provincial companies, municipal companies, and county companies must be in place. The second team must be in place. After four or five years of development, we have the conditions. We have the conditions.
As soon as the reform is in place, high-quality development and high-value service will continue. We have several provincial companies that have done very well. Their annual output has increased by more than 30%, and the profit is very good. So if a provincial company is selling 2B, 2C as a standard product is enough to sell 2B. So we have to look at these issues in depth.
At the same time, we want to improve the ability of technology personnel and managers to stimulate their firepower. This is actually the ability of resource configuration. We have done a lot of work in this area, especially technology personnel. In recent years, we have already had our foundation. The technology personnel is in the pattern of 10,000 people verified. In the field of enterprise strategic technology, the top talents, engineers and teams of ERCAI, this system is more complete.
The investment in R&D and manufacturing costs are also relatively large. Now we have all the necessary conditions to fully utilize them. Our requirements for technology managers are also relatively strict. We need to teach them the principles of the market, collective constraints, and collective constraints. So we need to continue to study these things in depth. At the same time, we must not limit ourselves to the internal business. We need to further deepen, reform, and open up.
For China Telecom, openness is the effective configuration of achieving resources on a larger scale. It is necessary to integrate good resources from outside into the enterprise through openness, and integrate them into the mainstream process to provide services to customers. At the same time, it is necessary to be brave enough to integrate your own high-quality resources outside to provide some services to customers. These are some of the important contents of China Telecom's openness.
This year, our reform will take a new step. I believe that through the reform, China Telecom's high-quality development will also take a new step. Okay, that's all I have to say. Thank you. Okay, thank you. Okay, for the next Q&A session, we'll leave it to our friends in the audience. Our staff will pass the microphone to you, our friends in the audience. Okay, the lady in the middle. Thank you.
Hello, I am Jieyi Li from the Ministry of National Defense. The chairman just mentioned that telecommunications will be open again. I would like to know if the Ministry of Public Information and Telecommunications has recently expanded the openness of telecommunications, for example, to promote the recording of satellite Internet business.
I would like to congratulate you on your good performance in the first half of the year. However, I would like to know, in the face of the economic downturn, how do you plan to reduce the IT infrastructure of your customers?
I would like to know how big the impact will be on Zhongtianxin in the second half of the year or next year. Do you need to make any adjustments to your capital expenses for the whole year? Thank you. Thank you. Thank you for your continuous attention and help over the years. I just talked about opening up. We have been insisting on reform and opening up for the past few years. I just talked about opening up.
It must be in an open environment for companies to develop healthily. Now, all kinds of networks and businesses in the original telecommunications industry have been fully opened. In fact, we are already in a very open environment, competing, cooperating, providing services, and improving the value. You see, many of our businesses are completely open. You see, your business is open.
Liang Zi didn't say that he would quit. Right? Political businesses are all open. Artificial intelligence is even more like this. So we welcome it. We think that such a country's policy of opening up to the outside world is a very good policy environment and a position for the development of China's telecommunications industry. We actively integrate and seek our own development in it, some development of these companies. You just talked about the issue of macroeconomics. As a company,
When we think about work, we have to look at the present and the long term. China's economy, according to the data released by the National Bureau of Statistics from 1st to 7th of July, is steady and stable, and the situation is still going up and up. From the perspective of the development of our company, in the first half of this year, our entire service income and profit growth
So, from our perspective, we can see that we are very confident in the future development of our company. However, in terms of market conditions, companies should be good at finding new opportunities in the market.
There are opportunities and challenges. There are good growths and there are bad growths. In our business, there are good growths, there are fast growths, and there are also relatively slow growths. The same is true for production. In the first half of this year, the overall growth of our production was as expected. At the same time, we can see that there is a real need for potential.
There are still some projects that are funded. It depends on how you capture these projects. For example, the digital transformation of enterprises is undoubtedly the direction. So whether you can provide these enterprises to meet their needs and enhance their value, I believe this is a good project. So we have confidence in this.
Recently, there have been a few good projects. For example, our emergency communication products. Some of our small and medium-sized micro-enterprises' smart products and services. Those AI products and services are doing well in this area. Over the past few years, even on the traditional business basis, we have added some of the high-end products of AI, such as the cloud computer of AI, the video coloring of AI,
AI mid-range. They sell very well and grow very fast. This is a sample. It's the same in our company. We have a consensus in China Telecom. If you want to give something to someone, you should use it first. If you don't use it yourself, how can you convince others? In our company, we have 10 AI models in our company. They play an important role in system reduction, efficiency, and efficiency.
These are all very good products and services. Now that enterprises are in a critical period of development, I think we should be more confident. In March of this year, our guidance for the whole year is unchanged. In terms of income and capital expenditure, I will talk about our view on capital expenditure. In terms of the overall figure, you notice that the capital expenditure has increased by 13.5%.
This number is not very compatible with other numbers. But why should we invest in the management layer? It depends on the structure. In the first half of this year, we added 11 FLOPS. In the first half of this year, we added 11 FLOPS. We are not investing in this area. There won't be too many big models in the short term. This is a direct business development.
But large-scale model technology, for a company like Artificial Intelligence, without large-scale model research, without its own WAN card, without large-scale model research, it will be very passive in the future. Another thing we can see is that when we look at large-scale models, we are more concerned about GPU. Where does GPU go? It must go to DC.
This machine room is different from the original IDC machine room. It is an AIDC machine room. It has requirements for energy saving, power supply, weight, and management. Who is going to do this? We saw this opportunity. We set it up early. So we are the first typical AIDC in Shanghai and Ninggang. And after the AIDC was built, it has a very strong programming ability. Its high machine price, high power machine price, and utility,
and the number of advancements is very good. So in this case, we should agree boldly. But don't worry, as I said on the PPT, the total investment of 9.6 billion yuan in the whole year, and the value of capital expenditure in terms of income, will be within 20%. This value is unchangeable. We mainly adjust the structure.
and for the future development and storage of our energy. Okay, thank you. Next, let's welcome our interviewee, Ray, and then we'll have an online media question. Thank you. Okay, the next question is from Liu Canbang from Zhengquan Times. Your line is now open. Please ask your question.
Hello, host. Can you hear me? Yes, we can hear you. Please go ahead. Okay. Mr. Ke, hello to all the managers of China Telecom. First of all, congratulations to China Telecom for achieving a very good business performance in the first half of the year. My question is about artificial intelligence, especially since artificial intelligence has become an important driving force for a new round of technological revolution and industrial change.
Okay, thank you.
After the introduction of artificial intelligence in Shenzhen, we have been keeping a high level of attention for more than two years. This is indeed a direction and an important driving force. But when it comes to a particular enterprise, for example, China Telecom, how do we grasp the development opportunities of artificial intelligence? How do we combine our own resources and some practical things?
to promote the development of AI, and in the process of AI development, to gain the growth and value of the enterprise. In March this year, when I published my annual results and communicated with the media and investors, I said that everyone is very concerned about Tianyu Cloud. Just now, I also emphasized on GPC, because everyone is concerned,
Again, it lists the political parties and the ratio. At the same time, in March, I also shared a point of view with you. That is, Tianyu Cloud has passed the turning point towards the development of smart clouds. So, what is standardization? Standardization is the establishment of technologies and platforms such as the computing transfer platform, which we represent as Xirang.
As you mentioned just now, the integrated computing, service system and capability. This is a more general statement. To put it more simply, the integrated computing, service system and capability is the smart cloud, the smart cloud of China Telecom.
It is the smart cloud that has developed to this stage. It is the smart cloud. The integrated smart service system and capabilities are the smart cloud of China Telecom, which is the smart cloud of China Telecom now. The text is more accurate, isn't it? Since it is a system, what is the system of the smart cloud of China Telecom in the era of artificial intelligence? Let's divide it into five according to the results.
The following are the S-layers. The middle one is PaaS, which is Xero. Above are the data layers, model layers, and application layers. These are the five layers of the integrated system. There is a lot of content in this. I won't go into it. As for the S-layers, I also talked about this when I answered the question from Da Gong Bao.
We talked about AIDC. AIDC is actually a physical existence in the S-layer. Many GPU chips are actually in the S-layer. It is in the S-layer at the bottom of the smart cloud system. PAS is our C-ray.
There are model layers, data layers, and application layers. I won't go into the details of the three layers. Let me focus on Xirang. Xirang, as a path layer, is the core structure and core ability of the entire smart cloud. What does it do? First, no matter what kind of computing power you have, no matter where you are distributed, you can communicate through the integration of cloud and network, the technology of cloud and network.
This is the first and the most basic one. We talked about this in March. The second one is to build a computing power, to control the supercomputer, various GPUs and chips, so that we can have effective equipment and high-efficiency computing. The third one is to provide a more economically reasonable toolset for training large models and inference. This is the first one. This is the Chinese telecommunications
This is the core platform of the AI cloud. As we just talked about, in terms of AI, as we just talked about, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms of AI, in terms
So you see, this year, we have invested in two WAN cards. We have invested in two WAN cards. We have invested in AIDC to form two EU standards. This is all done internally. Our calculations, this year, we have increased our calculations by 10 billion, and we have achieved a smart calculation of 2.1 billion Flopos. First, we have joined Xirang's platform.
Tianyin Cloud Platform. As for our large-scale models at the mass level, as we mentioned in the presentation, whether it is a technology model or an application model, we are actively publicizing voice, speech, multi-modal and visual models. There are more applications on it, whether it is a 2B, 2C standard, or some internal applications. First, we start from the inside. At the same time, it is a very open system.
to be able to access external computing power, to be able to adapt to a variety of chips, to be able to adapt to a variety of computing models, to be able to adapt to a variety of data ecosystems, to be able to adapt to a variety of models, and to be able to adapt to a variety of applications. I think this is an open ecosystem. For example, in the first half of this year, we have already realized that there are 39 companies with computing power,
and integrate them into our system to provide services to the outside world. In addition, it has 2.2 billion, plus our 2.1 billion, there are more than 4 billion smart computing on it. And we are in several cities, within the Yangtze River, in universities,
and in some remote areas. I think this is a very good model of intelligent development. This is an opening. This is an opening. So I think this promotes the development of intelligence. That's all I have to say. Because of time constraints, I don't have a lot of specific content. Let's find another opportunity to have a deeper conversation. Thank you.
Okay, thank you. Next, we will go back to the audience and see if there are any questions from the media. Okay, please go ahead. Excuse me, I would like to ask about the mobile phone connection satellite service. I would like to know, in China,
How many clients do you have? And what is the situation in Hong Kong? Can you share with us? Thank you. This mobile phone satellite is a very good business. At this stage of development, the number is not so much. But it is a specific group. There are mainly two groups. The first one is
the protection of emergency communication. When there is a traffic accident, in some areas, when the network is usually interrupted, the mobile phone can be connected directly. Recently, in many places in the Mainland, there have been many flood disasters. The mobile phone connected satellite has played a very important role in the process of anti-traffic, emergency, and rescue.
Because it is a mobile phone, its own number, its own mobile phone, put it in its own pocket, right? It is often used, so take it out and broadcast it, and everyone outside knows who it is. It broadcasts outside, its numbers are all stored inside, so it plays a very important role. It has a specific group. At the same time, on the other hand, it is a group that can face the high-end. This is the second group.
This high-end group, for example, we have cell phones that connect to satellites. We also have cars that connect to satellites. What's the name of that car? It's a million-dollar car. It's a high-end越野車. It's越野, it's not in the city. Maybe it's in the mountains. The scenery is good there. It's also a way of life. So that satellite is a standard.
There is a huge demand for this development. There is also a demand for coastal islands and mountainous areas. But overall, it is relatively specific in the customer group. Because in this aspect, it also plays the role of mobile phone inter-satellite with maximum efficiency. It is not simple. The demand is not so urgent. Our resources are still limited.
This is what we are focusing on. Hong Kong has already launched this service. We have already obtained the code for the international telecommunications network. In the next step, we will cooperate with international operators to develop this service in accordance with their regulatory requirements. The key is to meet the customer's needs.
At the same time, we will also develop the whole world with mobile phones and satellites. We also have a lot of very good layout and practice. Some things have good effects. For example, low-altitude satellite communication. So it's not limited to the high-level satellite communication. We want to have satellite communication. And the development of 6G is also
Thank you. We have one last question.
Hi, I'm a reporter from SEDAC. Just now, Mr. Ke mentioned a lot about the accounting. In addition to the four e-flop accounts that were added in the first half of the year, the growth rate is also quite large, and we have also joined a lot of accounts with our partners. I would like to ask, in the second half of the year and July and August, are you also deploying some new accounts, and will the amount of new accounts in the future continue to be so fast?
And then the second question is, as you just mentioned, the number of CAPACS will not change, and then the structure will be adjusted. How much detail will be used in the in-depth layout for 5GA, and what will be the deployment? Thank you. Thank you. This is also related to computing power.
This year, our capital expenditure will not exceed 960 billion yuan, which is less than 20%. At the same time, the problem of computing power is quite complicated. In the first half of this year, we built two Wanka Ponds. We do not plan to build a few more Wanka Ponds.
First of all, we need to prepare the WanCard pool, the training, and the matching. The WanCard pool is not a simple 10,000-card pool. It is a highly complex system with a high level of science and technology. We did some research with our partners on this and achieved some good results. But at the same time, we need to pay attention to
The development of GPUs and smart cards are also moving forward. So we pay more attention to building such a smart cloud system to adapt to all kinds of applications. If we can adapt well to a few chips, the next step is to go to larger applications.
When mature applications and models are clearly displayed, we have the advantage, we have the conditions, and the transformation is faster. This is how we look at computing. At the same time, we have to make use of this advantage. After computing, you have to provide some services through public and private cloud. This is the role of our cloud. I think this is one. The second one is about capital investment.
They are mainly concerned about 5G-A. 5G-A is more of a lightweight and software deployment. It doesn't have much investment demand for capital. The key is how we can find, or how we can equip the client with its lightweight deployment. In this regard, we have a lot of practice on it.
There is no need to increase investment in 5G on a large scale in the first half of the year or the second half of the year. It is mainly based on customer needs. And the investment impact on the entire capital investment is not very large. Thank you. Thank you for your questions and answers. Due to time constraints, today's press conference ends here. I hope this exchange will be helpful to you. Thank you for your attention and support to China Telecom.
The complete video of this press conference can be viewed at the Shangzheng Recording Center. See you next time. Thank you.